Category: Litigation

Getting Political: Florida Gubernatorial Candidate Democrat Jeff Greene Personally Hit with TCPA Class Action

As I have written numerous times, where the TCPA intersects politics things can get spicy.

Imagine it–using a draconian statute to assault your political rivals and bludgeon old foes with ligation designed to extract millions of dollars from their pocket based upon campaign phone calls.

Suing political candidates under the TCPA has become a bit of a ritual in America over the last few years. Obama faced a TCPA suit. As did Trump. More recently Beto O’Rourke faced such a suit. As did an organization supporting the Kavanugh confirmation.  Heck, even the Human Society’s text campaign supporting California’s Prop 12 was *ahem* neutered by a TCPA class action.

In furtherance of that great tradition,  a Florida resident named Lynda Maceda filed suit yesterday against bested Florida gubernatorial candidate Jeff Greene. According to his wiki page Jeff is a successful business guy and real estate investment type. According to Ms. Maceda’s Complaint, however, he’s a robocaller that sent the following message without consent:

“Hi, this is Democrat Jeff Greene running for governor. I’ll stand up to Donald Trump and for Florida’s families. Joseph, if you want world-class schools, commonsense gun reform and to protect women’s choice, please vote for me with your absentee ballot! Can we count on your support?”

The Complaint alleges that thousands of similar complaints were sent all of them without express consent. Ms. Maceda hopes to represent a failsafe clas of all individuals that received the texts without express consent. If these allegations are proven Ms. Maceda hopes to hold Mr. Greene accountable for “amounts [] greater than $15,000,000.” Gees.

Notably, Mr. Greene is sued personally for these violations–usually these TCPA claims are asserted against a candidate’s campaign rather than against the candidate individually.

The Complaint can be found here: Class Action Complaint against Florida Democratic Gubernatorial Candidate Jeff Greene

 

© Copyright 2019 Squire Patton Boggs (US) LLP
This post was written by Eric J. Troutman of Squire Patton Boggs (US) LLP.
Read more Litigation news on the National Law Review’s Litigation Type of Law page.

In re Celexa and Lexapro – The First Circuit Weighs in on China Agritech and American Pipe Tolling

The Supreme Court meant what it said in China Agritech, Inc. v. Resh – that is the primary lesson from the First Circuit’s January 30th decision in In re Celexa and Lexapro Marketing and Sales Practices Litigation.  As my partner, Don Frederico, explained in a blog post last year, the Supreme Court observed in China Agritech that its prior ruling in American Pipe & Constr. Co. v. Utah “tolls the statute of limitations during the pendency of a putative class action, allowing unnamed class members to join the action individually or file individual claims if the class fails.”  China Agritech went on to hold that “American Pipe does not permit the maintenance of a follow-on class action past expiration of the statute of limitations.”  The First Circuit, in In re Celexa and Lexapro, rejected a plaintiff’s attempt to read China Agritech narrowly.

In re Celexa and Lexapro involved consolidated prescription drug marketing cases.  Plaintiffs asserted RICO and state-law claims, alleging that defendants fraudulently promoted antidepressant drugs for uses the FDA had not approved – referred to as “off-label” uses.  The same defendants had previously been named in a qui tam action that was unsealed in February 2009.  One of the plaintiffs, Painters, and Allied Trades District Council 82 Health Care Fund (“Painters”), sought certification of two classes of third party-payors that had paid for or reimbursed off-label prescriptions of Celexa or Lexapro. The district court denied class certification.

On appeal, the First Circuit – while brushing aside the district court’s concerns about individual issues of causation and injury – nevertheless affirmed the denial of class certification.  Judge Kayatta, writing for a unanimous panel, concluded that Painters had put forward evidence that could establish causation and injury on a class-wide basis.  He went on, however, to find that the class action was time-barred.

The Court first found that Painters’ individual claims were timely.  The Court concluded that the four-year statute of limitations was subject to the discovery rule and held that, as a matter of law, the limitations period began running in March 2009 after the qui tam action was unsealed.  Painters’ claim was timely because the running of the limitations period was stayed for eight months by a prior class action (the “N.M. UFCW case”).  Because Painters was a putative class member of that prior class action, American Pipe tolling applied to its claim during the pendency of the N.M. UFCW case.

Even though Painters’ own claim was timely, the Court nevertheless held that Painters’ class action was not.  As Judge Kayatta wrote,

China Agritech clarified that [American Pipe] tolling has limits: While a putative class member may join an existing suit or file an individual action upon denial of class certification, a putative class member may not commence a class action anew beyond the time allowed by the untolled statute of limitations.

The Court refused to limit China Agritech to situations in which class certification was denied in the earlier-filed class action.  Painters had argued that, unlike China Agritech, there was no substantive ruling on class certification in the N.M. UFCW case that had preceded Painters’ own action.  The First Circuit, however, held that the decision in China Agritech stood for the broad proposition that the “tolling effect of a motion to certify a class applies only to individual claims, no matter how the motion is ultimately resolved.  To hold otherwise would be to allow a chain of withdrawn class-action suits to extend the limitations period forever.”  The Court, therefore, affirmed the denial of class certification.

After In re Celexa and Lexapro, there is no doubt that China Agritech is no paper tiger in the First Circuit.  The rule is clear:  a class action does not toll the statute of limitations for subsequent class actions.

 

©2019 Pierce Atwood LLP.
This post was written by Joshua D. Dunlap of Pierce Atwood LLP.
Read more litigation news on the National Law Review’s Litigation type of law page.

Second Circuit Upholds District Court’s Choice of Equitable Remedies Under ERISA and Its Decision to Award Prejudgment Interest at the Federal Prime Rate

The Second Circuit Court of Appeals recently issued an opinion in Frommert v. Conkright, affirming a district court decision regarding appropriate equitable remedies under ERISA and the amount of prejudgment interest to be applied. The Second Circuit’s views on each of these issues should be of interest to plan fiduciaries as well as practitioners.

This litigation has a long history, dating back to 1999, and has generated many court opinions along the way, from the district court level all the way up to the U.S. Supreme Court. Indeed, this is the Second Circuit’s fourth decision in this case. (Readers are likely familiar with this case from the 2010 Supreme Court decision, which addressed the standard of review and held that an honest mistake does not strip a plan administrator of the deference otherwise granted to it to construe plan terms.)

By means of background, the litigation was initiated by Xerox employees who had left the company in the 1980s, received distributions of the retirement benefits they had earned up to that point, and who were subsequently rehired by Xerox. In addition to the issues concerning interpretation of the Plan and related documents, the primary focus of the case was how to account for the employees’ past distributions when calculating their current benefits so as to avoid a “double payment” windfall.

In 2016, the District Court for the Western District of New York issued two decisions that led to the instant appeal. After having been previously directed by the Second Circuit to fashion, in its discretion, an equitable remedy providing appropriate retirement benefits to the rehired employees (referred to as the “New Benefits”), the District Court chose the equitable remedy of reformation and held that the New Benefits should be calculated as if the plaintiffs were newly hired upon their return to Xerox, without any reduction of the benefits to account for prior distributions or any credit for prior years of service. In a second decision later that year, the District Court determined that the plaintiffs were entitled to prejudgment interest at the federal prime rate.

The plaintiffs appealed both decisions. As to the remedy, the plaintiffs argued that the “new hire” remedy fashioned by the District Court was inadequate, and the court should have chosen a calculation of New Benefits that was more favorable to them using either surcharge or estoppel. The Second Circuit was not persuaded. In affirming the District Court’s decision, the Second Circuit noted that each of the equitable approaches considered for calculating the New Benefits were imperfect and even the new hire approach had its flaws. Nevertheless, it found that the District Court did not abuse its discretion in selecting this method. The Second Circuit pointed out that the new hire approach accounted for the time value of money and better balanced the competing interests of the Plan Administrator and the plaintiffs. Having determined there was no abuse of discretion by the District Court, the Second Circuit found it unnecessary to address whether relief would alternatively have been proper pursuant to different equitable remedies such as surcharge or estoppel.

The plaintiffs also argued that the District Court was affirmatively required to interpret the Plan, which might have yielded a higher benefits award. Again, the Second Circuit was not persuaded, finding that this argument ran afoul of one of its prior decisions in the case finding that the District Court need not engage in plan interpretation if it determined an appropriate equitable remedy existed. Citing to Cigna v. Amara, the Second Circuit reaffirmed that district courts generally may avoid interpreting a pension plan and instead fashion equitable remedies for ERISA violations where the plan is “significantly incomplete” and misleads employees, and reformation is among the equitable remedies available.

As to the issue of prejudgment interest, the plaintiffs sought the New York statutory interest rate of nine percent, whereas the Plan Administrator proposed the federal post-judgment interest rate of 0.66 percent. The District Court rejected the state statutory interest rate as too high and the federal rate as too low. It awarded prejudgment interest at the federal prime rate of 3.5 percent, explaining that it struck an appropriate balance and fairly compensated the plaintiffs. Noting that the District Court enjoyed broad discretion as to whether to grant prejudgment interest in the first place and to select a rate, the Second Circuit upheld the decision, finding that the District Court had carefully considered all the relevant factors and thoroughly explained its reasoning for using the federal prime rate.

 

Copyright © 2019 Robinson & Cole LLP. All rights reserved.
This post was written by Jean E. Tomasco of Robinson & Cole LLP.

Fourth Circuit Expands Title IX Liability for Harassment Through Anonymous Online Posts

The Fourth Circuit recently held that universities could be liable for Title IX violations if they fail to adequately respond to harassment that occurs through anonymous-messaging apps.

The case, Feminist Majority Foundation v. Hurley, concerned messages sent through the now-defunct app Yik Yak to the individual plaintiffs, who were students at the University of Mary Washington. Yik Yak was a messaging app that allowed users to anonymously post to discussion threads.

Because of the app’s location feature, which  allowed users to see posts within a 5 mile radius, the Court concluded that the University had substantial control over the context of the harassment because the threatening messages originated on or within the immediate vicinity of campus. Additionally, some of the posts at issue were posted using the University’s wireless network, and thus necessarily originated on campus.

The Court rejected the University’s argument that it was unable to control the harassers because the posts were anonymous. It held that the University could be liable if it never sought to discern whether it could identify the harassers.

The dissent encouraged the University to appeal the decision stating that “the majority’s novel and unsupported decision will have a profound effect, particularly on institutions of higher education . . .  Institutions, like the university, will be compelled to venture into an ethereal world of non-university forums at great cost and significant liability, in order to avoid the Catch-22 Title IX liability the majority now proclaims. The university should not hesitate to seek further review.”

 

Copyright © 2019 Robinson & Cole LLP. All rights reserved.
This post was written by Kathleen E. Dion of Robinson & Cole LLP.
Read more about college and university legal news on the National Law Review’s Public Education Page.

Administrative Agency Deference Theme Reemerges with SCOTUS Considering Overturning Auer

The U.S. Supreme Court signaled that it remains concerned with the issue of administrative deference following its grant of certiorari last week to hear Kisor v. O’Rourke specific to the issue of whether the Court should overrule Auer v. Robbins and Bowles v. Seminole Rock & Sand Co. Overruling one or both of these decisions could result in courts giving considerably less deference to agencies’ interpretations of their own regulations.

The ability of regulatory agencies to interpret their own regulations is a fundamental issue in many environmental disputes. Both Auer and Seminole Rock are frequently cited in environmental cases to support agency actions, as these decisions require courts to give agencies near-absolute deference, so long as their decisions are not “plainly erroneous or inconsistent” with other regulations.

In practice, agencies that promulgate vague regulations through notice-and-comment procedures required by the federal Administrative Procedure Act can later expand the ambit of these regulations through informal memoranda or regulatory interpretations. These less formal processes preempt the ability of the public and regulated community to meaningfully participate in the regulatory process.

Administrative deference is an ongoing theme that we have seen arise a number of times in the past few years. Indeed, the legal community had pondered whether the Supreme Court would review administrative deference issues in the Weyerhaeuser Co. v. U.S. Fish & Wildlife Service caseinvolving the dusky gopher frog that was decided a few weeks ago. Although the Supreme Court decided Weyerhauser without reference to issues of administrative deference, the Kisor case is a clear example that this is not going away.

However, Kisor actually arises in a context fairly atypical for administrative deference. The case involves a claim for PTSD-related retroactive disability benefits brought by a former Vietnam-War-era Marine who was denied retroactive disability benefits for PTSD he suffered as a result of his service in Vietnam. Kisor’s eligibility for such benefits hinged on whether the VA received “relevant official service department records” after initially denying his claim for benefits in 1982.

Kisor argued that material he submitted to the VA relating to his service in Vietnam constituted “relevant official service department records” and entitled him to retroactive benefits. The Board of Veterans Appeals (“Board”) disagreed, stating that, in Kisor’s case, “relevant” records were those relating to a diagnosis of PTSD (which was contested at the time of his initial denial). That Kisor served in the military was never in dispute.

The Court of Federal Claims upheld the Board’s interpretation of the meaning of “relevant.” In so holding, the court concluded that the term was ambiguous, and that the Board’s interpretation was entitled to deference under Auer, Seminole Rock, and their progeny, because it was neither “plainly erroneous or inconsistent” with the VA’s regulatory framework.

Kisor illustrates the breadth of power granted to agencies by Auer and Seminole Rock – the agency’s determination of whether “relevant” records were provided was quite possibly outcome-determinative for the involved claims.

The case is expected to be heard by the Court at some point in 2019. We will keep an eye out for further developments on Kisor and similar cases touching on administrative deference.

 

© 2018 Schiff Hardin LLP
Read more Litigation news at the National Law Review’s Litigation page.

Preliminary approval of class action settlement for Experian data breach exceeds $47M

Remember Experian’s massive data breach of 15 million customers in 2015?  The resulting consolidated class action is nearly resolved.  On December 3, 2018, a California federal judge granted preliminary approval to a proposed class settlement valued at over $47 Million.

Forty lawsuits against Experian were consolidated in the U.S. District Court for the Central District of California.  The class members, all T-Mobile USA customers, may have had their names, addresses, Social Security numbers, birth dates and passport numbers compromised in the breach.

Strictly speaking, this is no longer a FCRA case. In December 2016, the court granted in part Experian’s motion to dismiss, agreeing with Experian that it did not furnish a consumer report in violation of the FCRA because “[t]heft victims don’t ‘provide’ a thief with stolen goods.”

The settlement includes a $ 22 million nonreversionary settlement fund, which will be used to provide two years of credit-monitoring and insurance services to class members who submit valid claims, cash payments for out-of-pocket costs and documented time spent due to the data breach, $2,500 service awards for each class representative, as well as attorneys’ fees and costs, not to exceed $10.5 million.  In addition, $11.7 million must be set aside for remedial and enhanced security measures at Experian.

Copyright © 2018 Womble Bond Dickinson (US) LLP All Rights Reserved.

This post was written by John C. Hawk IV of Womble Bond Dickinson (US) LLP.

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Preparing your Company for Discovery with Cloud Faxing

Discovery refers the process by which documents and other material are sought, collected and examined, usually for use as legal evidence in a civil or criminal case.

Organizations that fail to produce discoverable material can face severe penalties, so it is critical that companies have a sufficient infrastructure in place to ensure discovery obligations are met.

For most types of discoverable material — such as emails, invoices, spreadsheets — deploying a document review platform can keep the discovery process quick and inexpensive. But other documents, such as hard copy faxes, can be trickier to manage.

Potential issues with legacy fax records

Traditional desktop fax machines are still commonplace in many office environments. Although fax records in most organizations are stored as hard copies, as far as discovery obligations are concerned, all faxes — whether sent or received — could potentially be discoverable material. Therefore, it is critical that organizations treat fax documents the same as any other types of documents.

But when a discovery request is issued, having to scour through mountains of paper fax records can be time-consuming, tedious and stressful for the staff involved. So how can the process be improved? When it comes to preparing for discovery, there are three routes you can take with regard to your fax review:

1. Take the risk with legacy fax

But by sticking with your legacy fax system, when a discovery request comes in, your organization may not be prepared and could descend into panic — panic that could be avoided.

Such an unmethodical and frantic data recovery process can not only cause huge disruption to staff productivity but could also result in a late response to a discovery request which could lead to regulatory penalties for your organization.

2. Implement a paper-to-electronic fax policy

Your second option is to implement a new ‘paper-to-electronic’ fax archival policy; each time an employee sends or receives a paper fax document, they must file the hard copy in a secure filing system and then scan and save an electronic copy of the fax making sure to include any metadata.

This will create an electronic library of all client-related faxes that is readily available in the event of discovery request.

While this solution avoids the chaos of combing through paper records, it is time-consuming, and its success relies entirely on the attention and care taken by staff members.  As such, it is highly vulnerable to human error. One misfiled or incomplete document could jeopardize your discovery process.

3. Adopt a cloud-fax solution

The final option is to trade in your organization’s legacy faxing infrastructure for a fully hosted, cloud fax solution. This will allow your employees to send and receive faxes by email (or from a user-friendly platform), directly from their computers or even their mobile devices.

Many cloud fax systems will automatically save electronic records of faxes sent or received by your organization, along with metadata, in a secure storage base. Therefore, should your company receive a discovery request, you may be able to leverage a cloud fax system to quickly respond while minimizing disruption to your business operation.

Traditional paper-based fax isn’t going away anytime soon, but its days are definitely numbered. For forward-thinking organizations that value efficiency, accuracy, and privacy there’s only one fax solution that is able to offer true peace of mind, and that’s cloud fax.

 

eFax® is a registered trademark of j2 Cloud Services™, Inc. and j2 Global Holdings Ltd.
This post was written by David Hold of eFax.

Boof!: Pro-Kavanaugh “Robo-Texts” Trigger Potentially Massive TCPA Class Action against Faith and Freedom Coalition, Inc. in Florida

Apparently the Faith and Freedom Coalition (“FFC”)–allegedly some sort of Conservative-leaning PAC– blasted Florida residents with texts urging Senator Bill Nelson to support the Kavanaugh confirmation. The text (allegedly) read as follows:

This is Ralph Reed. A good man is under attack & needs your help. Call Sen Bill Nelson TODAY & tell him to confirm Brett Kavanaugh.

Subtle.

Similar texts were allegedly blasted to a bunch of folks in the area, none of whom–according to the lawsuit–consented to receive those texts.

The complaint–filed Monday in the Southern District of Florida by an agitated citizen named Shehan Wijesinha and found here Wijensinha v FFC—  alleges a class of all persons within the United States that were sent a text message by the Defendant without prior express consent. It is brought by noted TCPA class action attorney Manuel Hiraldo of Hiraldo, P.A.

The TCPA prevents text messages–including political texts–to cellular phones without consent. If the Defendant is found liable for sending the texts under the TCPA it may face exposure as high as $1,500.00 per text. Given the number of texts allegedly at issue in the suit this may cost the FFC many millions of dollars to resolve, a fact that may prompt the FFC to need a Devil’s Triangle this afternoon to unwind. (What? Its a drinking game!)

A recent Wyoming lawsuit found a state corollary law similar to the TCPA unconstitutional as applied to political messages–and you can bet your bottom dollar that the folks at FFC will assert a First Amendment challenge here.

We’ll keep a close eye on this one for you.

 

Copyright © 2018 Womble Bond Dickinson (US) LLP All Rights Reserved.
This post was written by Eric Troutman of Womble Bond Dickinson (US) LLP.

The New Jersey Supreme Court’s Latest Decision Affecting Pharmaceutical Multicounty Litigation

On October 3, 2018, the New Jersey Supreme Court made its long-awaited decision in the Accutane Multicounty Litigation. Developed by the New Jersey-based pharmaceutical giant Hoffman-La Roche, Accutane is a prescription acne treatment that has been found to be linked to inflammatory bowel disease.

Numerous plaintiffs filed lawsuits in New Jersey, essentially claiming that, based upon the drug maker’s own internal documents, Accutane’s warnings should have been stronger in stating that Accutane has been found to directly cause inflammatory bowel disease. A Multicounty Litigation was formed, which encompassed 532 plaintiffs – of which 18 were New Jersey residents, and 514 were residents of 44 different jurisdictions other than New Jersey.

In 2015, the trial court basically ruled that NJ’s Product Liability Act governed all of the cases in the Multicounty Litigation. Unlike the law in most other states, New Jersey’s Product Liability Act contains a rebuttable presumption that basically holds that a drug maker’s warning is adequate if it was approved by the United States Food and Drug Administration. The presumption can only be overcome if the plaintiffs show deliberate nondisclosure to the Food and Drug Administration, economically driven manipulation of the regulatory process, or clear and convincing evidence that the drug maker knew or should have known of the inadequacy of the warnings in light of the relevant federal regulations. Having found that the presumption applies to all of the cases, the trial court then held that the plaintiffs could not overcome the presumption and dismissed the cases.

That decision was appealed and the Appellate Division found that New Jersey’s Product Liability Act did not govern all of the cases, and that each case was governed by the respective laws of the jurisdictions where the plaintiff used Accutane. The Appellate Division analyzed the many different legal standards and found that the cases from the vast majority of the jurisdictions involved (including New Jersey), should not be summarily dismissed based on the federal approval presumption.

The matter was then taken up by the Supreme Court, which held that New Jersey has an interest in consistent, fair, and reliable outcomes in its consolidated Multicounty Litigation cases that cannot be achieved by applying a “diverse quilt of laws.” Having found that all of cases in the Multicounty Litigation were governed by New Jersey’s Product Liability Act, the Supreme Court went on to hold that the plaintiffs had not overcome Act’s rebuttable presumption and that the drug maker’s approved warnings were adequate as a matter of law. Accordingly, the Supreme Court dismissed all 532 cases.

The ramifications of the Supreme Court’s holding are still unclear. A recent, palpable lull in New Jersey Multicounty Litigation applications and filings was followed by changes on the bench through judicial retirements and promotions. Thereafter, there was a relative flurry of designations of Multicounty Litigations for Abilify, Taxotere, Zostavax and Physiomesh, all in the late spring and summer of 2018. No doubt, this Supreme Court ruling will serve to shape the procedural structure and legal strategy of the parties in all pending and contemplated pharmaceutical Multicounty Litigations in New Jersey.

 

COPYRIGHT © 2018, Stark & Stark.

What Investors Need to Know About the New $6.2 Billion Visa, Mastercard Settlement

Visa, Inc., Mastercard, Inc., and other financial institutions have agreed to pay merchants between $5.56 billion and $6.26 billion to settle a 13-year old antitrust litigation. For years, the case has driven shrewd investors to transact with retailers seeking to monetize their claims against the card companies. With a much-anticipated settlement now on the table, would-be investors should take note.

On September 18, an amended settlement agreement (the “Settlement”) was filed in the US District Court for the Eastern District of New York. The Settlement signals possible resolution of a long-standing lawsuit brought in 2005 by approximately 12 million retailers accusing Visa and Mastercard of improperly inflating interchange fees (also known as swipe fees) charged to retailers. The Settlement modifies a prior settlement agreement approved by the District Court in December 2013.1

The agreement, reached after a year of active mediation, seeks to remedy the flaws of the prior agreement. Notably, the Settlement limits both the scope and duration of the release. Additionally, it addresses only monetary damages associated with the lawsuit and is not contingent on the resolution of injunctive relief claims, which may be pursued separately.

Under the Settlement, the value of a merchant’s claim will be based on the amount of interchange fees attributable to that merchant’s Mastercard and Visa payment card transactions during the time period beginning January 1, 2004 up until the preliminary approval date of the Settlement. Pro rata payments to merchants who file valid claims will be determined by the amount remaining in the monetary fund after deductions for “opt outs” (as described below) and administrative costs, and by the aggregate dollar amount of claims filed.2

Similar to the prior agreement, the Settlement provides that the monetary fund may be reduced based on the number of merchants that opt out of the class. Up to $700 million may be returned to the defendants if more than 15 percent of the merchants opt out. If more than 25 percent of merchants opt out, the Settlement may be terminated.

The Settlement is still subject to approval by US District Judge Margo Brodie. If the Court grants preliminary approval, known class members will receive written notice concerning their legal rights. Claim forms are not available at this time.

Katten will keep you apprised of settlement developments and trading considerations. The case is In re Payment Card Interchange Fee and Merchant Discount Antitrust Litigation, case number 1:05-md-01720, in the US District Court for the Eastern District of New York.

1 In June 2016, the US Court of Appeals for the Second Circuit invalidated the original settlement on the grounds that certain merchants were not adequately represented because the same counsel had represented separate settlement classes with conflicting interests. The Court of Appeals also took issue with the broad release that would preclude merchants from pursuing certain future claims indefinitely. In March 2017, the Supreme Court declined to hear the case, remanding it back to the District Court for further proceedings.

2 The original settlement of $7.25 billion was, at the time, the largest in history. However, thousands of merchants ultimately opted out, reducing the monetary fund to approximately $5.3 billion.

©2018 Katten Muchin Rosenman LLP